Why published prices still fail at the bedside
Open enrollment season once again sends millions of patients into health plans with only a vague sense of what their care will cost. The posted price files exist, but they do not function like true market prices when patients cannot interpret them, cannot compare them easily, and do not keep the savings when they choose a lower-cost site of care. In practice, the system still pushes decisions through a fog of coding, billing and fragmented records.
Physician compensation and hospital margins make easy targets, yet they do not explain the patient’s experience of a confusing bill. Physician pay has been estimated at roughly 8% to 10% of national health spending, and median hospital operating margin in 2025 was about 1.3%. Many small hospitals lost money while caring for patients who cannot pay. Even a blunt cut to salaries and margins would leave the core problem untouched: the person choosing care still cannot see what the choice will cost.
The bill is visible only after the damage is done
Hospitals now post negotiated prices, and when common interventional radiology procedures were examined, commercial prices for the same procedure varied up to eightfold from one state to another. Same procedure, same training, very different price tags. That kind of spread makes “market competition” sound far more disciplined than it actually is. For patients, the number on the bill often arrives only after the decision has been made and the service has already been delivered.
The uninsured face a second layer of opacity. Emergency departments must stabilize urgent conditions regardless of ability to pay, but that obligation does not solve the cost of months of cancer treatment or other ongoing care. Then the bill arrives with undiscounted charges that no one actually pays, and patients understandably assume their physician collected far more than reality supports. Medicare pays about $92 for a typical office visit in 2026, and that payment has to cover not only the physician’s time but also the nurse, documentation, medical records, rent and equipment. Medicare also pays about $232 for placement of a tunneled dialysis catheter, including 10 days of follow-up care. Payment is tied to billing codes, not to how complex the patient was or how much time the encounter consumed.
Patients have no incentive to shop when the savings disappear
Commercially insured patients referred for a scheduled scan or procedure usually cannot see the price in advance. Their copay is often the same whether they choose a high-cost facility or a lower-cost one, which strips away the main force that makes shopping rational. If a patient chooses a center that costs the health plan thousands less, the patient keeps none of the difference. Under those rules, not shopping is the logical behavior.
When incentives change, behavior changes too. After the California Public Employees’ Retirement System set a reference price for hip and knee replacements, the share of members choosing lower-priced hospitals rose from 48% to 63%, and hospitals above the reference price cut their prices by about a third. The economic mechanism is straightforward: patients respond when a price difference matters to their own finances, and providers respond when patients can take their volume elsewhere. Price transparency without a real financial consequence is only partial information.
A small refund that patients discover after the fact has little power. Maine requires small-group insurers to share savings with enrollees who choose a lower-cost provider, yet in 2023 only about 1 in 2,600 eligible enrollees used it, with an average payment of about $51. A benefit that sits at the end of a complicated administrative trail does not alter behavior much in the moment of decision.
Three fixes that make transparency usable
The first fix is simple in concept and difficult only in execution: make the order portable. Physicians cannot review every price with every patient at the moment an order is placed, and the patient is usually the person who cares most about the cost. Each order should carry its procedure codes and a QR code so the patient can scan nearby hospital and imaging center prices for that exact order using files those facilities already post. The clinician still recommends a trusted site when quality or logistics make that appropriate, but the patient should control the final choice.
The second fix is to share the savings in a meaningful way. When a patient chooses a facility priced below the plan’s reference price, a real share of the difference should flow into an account the patient owns. It should be available tax-free for future medical costs or withdrawable as taxable income. Health savings accounts already operate on a similar principle, but only for high-deductible plans. A broader version could be created by states for commercial plans and exempted from state income tax, or established federally. Price shopping becomes credible only when patients can keep part of the reward.
The third fix is to let records travel with the patient. Price shopping does not work if care falls apart every time someone changes facility. Today, a patient who switches imaging centers may have to request a CD of their own scans, and the radiologist reading the new study may never see the old one. A stable nodule can then become a “new” workup simply because the prior images never arrived. A usable portable record does not need every note ever written. It needs the essentials: major diagnoses, past surgeries, recent labs and the actual images. Many large health systems already use the same records platform, and modern data standards have made exchange far easier than in the past. Facilities that will not share records should say so up front instead of forcing patients to discover friction after the fact.
Why price transparency still feels like a broken promise
This is not a plea for a new federal agency to set prices, and it does not require a sweeping new mandate on how physicians practice. It asks for a better market design: prices placed in front of the person making the choice, savings returned to the patient, and records that move without obstruction. Plans would spend less, patients would keep a portion of the savings, and high-priced facilities would face real pressure to justify their charges or lower them.
The stubborn flaw is procedural, not abstract. Patients still cannot see the price, still have no reason to compare, and still cannot carry their own history with them. Until those three failures are fixed together, price transparency will remain a website that technically exists but rarely changes the decision in front of the patient.